Zynga CEO Mark Pincus speaks during the Zynga Unleashed event at the company's headquarters in San Francisco, October 11, 2011.Stephen Lam/Reuters
Zynga Inc. founder Mark Pincus is cutting 18 per cent of the casual-games company's work force, less than a month after retaking the reins as chief executive officer.
The firings, amounting to 364 jobs, are part of a cost-reduction plan that will save $100-million (U.S.) annually, the company said Wednesday in a statement. Pincus, who replaced CEO Don Mattrick on April 8, is also cutting back on outside services and reducing central functions as he works to develop hit titles for mobile devices, he said in an interview.
"We have urgency to focus the execution of the company," Pincus said. "We're just at the beginning of launching the most exciting mobile slate in our history."
The job cuts will mostly affect corporate and central-services roles, Pincus said. The company, known for FarmVille and Words With Friends, is focusing on mobile games that fit into five categories, including casino and racing. The company's first so-called mobile action strategy release, Empires & Allies, went live on Tuesday.
Zynga announced the job cuts with first-quarter results, which showed growth in mobile, where the company has lagged behind competitors. Mobile bookings rose 84 per cent from a year earlier, and accounted for 63 per cent of total business, the company said.
The company reported a loss of 1 cent a share, excluding some items, narrower than analysts' projections for a loss of 2 cents, the average of estimates compiled by Bloomberg. Bookings totalled $167.4-million, versus the average estimate for $163.4-million.
For the current period, the company projects a range of $145-million to $160-million in bookings, below the $161.8-million estimate, and an adjusted loss of 2 cents a share, which matches analysts' views.
Zynga, once the leader in social games played on Facebook, has struggled to make the transition to mobile phones.
Mattrick, a former Microsoft Corp. executive, joined the company as CEO in July 2013. Since Pincus's return, senior Zynga executives including chief operating officer Clive Downie have left the company. Pincus brought back a former lieutenant, Marcus Segal, as senior vice president of operations.