Following Zynga’s announcement of predicted losses for the third quarter for 2012, their share price was hammered by investors. The giant social gaming company announced it expects net losses of between $90 million and $105 million. This has led to a 20% drop in share price from $2.81 to about $2.24. Zynga has had a tumultuous period since their IPO listing of $10 a share. Added to this is their loss of top executives who are looking for greener pastures. In an effort to improve the fortunes of the company CEO Mark Pincus has done everything from building their own website to plans to enter the real money online poker market in the first half of 2013. Before the social gaming giant was dependent largely on Facebook which accounted for over 90% of its business. The idea was to lessen their dependence on Facebook but this has not resulted in the desired results.

Currently Zynga is going through a rough patch to put it mildly but they cannot be written off. They still boast revenues of $1,2 billion annually as well as having over 311 million monthly active users. Many experts see the future growth potential for Zynga in mobile gaming. In the past they dominated the market with over 9 out of 10 games on Facebook belonging to Zynga. This has changed dramatically but their mobile presence is still one of the leading in the industry.

To quote CEO Mark Pincus,” At the same time, we are continuing to invest in our mobile business where we have one of the strongest positions in the industry. These actions support our strategy to transition from being a first-party web game developer to a multi-platform game network. We remain optimistic about the opportunity for social gaming and the power of our player network of 311 million monthly active users. When we offer our players highly engaging content, they respond. FarmVille2 has been our most successful launch since CastleVille in terms of daily bookings, and we now offer three of the top five most popular mobile games in the U.S. in terms of time spent according to Nielsen.”

It remains to be seen what will become of Zynga but as we have extensively reported they are still a formidable player who have the potential to return to their glory days.Third quarter results are expected to be released on October 24th.

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