Zynga Is Getting Absolutely Demolished Today

Zynga’s stock is down 20% this morning after it lowered its financial outlook.

The once-hot social gaming company said it lost $100 million last quarter, and it’s going to have lower than expected bookings for the year.

This is the most spectacular flame out of a high profile Silicon Valley company in a long time. The company’s market cap is down to $1.71 billion. It has over a billion in cash on hand, which means its business is really being valued at ~710 million. When it started the process to go public last year, reports trickled out that it was looking for a $20 billion valuation.

Zynga has been crushed because it failed to produce new hit games people love.

A few years ago, people thought Zynga had cracked a new formula for gaming companies by making social games for the Facebook audience. It turns out Zynga has the same problems as any games maker. It’s a hit driven business. And it hasn’t had a hit in a while.

Don’t Miss: The Zynga Insiders Who Cashed Out Before The Crash

znga

Photo: Screenshot

NOW WATCH: Tech Insider videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.

Tagged In

sai-us zynga