Zynga posts bookings below estimates; will close Beijing office

FarmVille creator Zynga reported lower-than-expected quarterly bookings as releases such as “New Words with Friends” failed to excite gamers. Shares of the company, which also forecast current-quarter bookings below analysts’ estimates, fell 10 percent in extended trading.

The mobile games company said it would close its Beijing office by June 30 and lay off all 71 employees.

Zynga reported bookings of $182.4 million for the fourth quarter. Analysts on average had expected $201.5 million, according to research firm StreetAccount.

The developer of “Zynga Poker” forecast current-quarter bookings of $140 million-$150 million, below the average analyst estimate of $202.9 million.

Zynga records the sale of virtual goods and downloads as deferred revenue, which is recognized as these goods are consumed. Bookings equal revenue recognized in a period plus the change in deferred revenue.

“Candy Crush Saga” creator King Digital Entertainment Plc reported higher-than-expected quarterly revenue and profit as newer games such as “Candy Crush Soda Saga” more than made up for the declining popularity of its older titles.

Zynga forecast an adjusted loss of 3-2 cents per share and revenue of $155 million-$165 million for the first quarter ending March 31.

Analysts on average were expecting the company to break even on a per-share basis and report revenue of $200.9 million, according to Thomson Reuters I/B/E/S.

Zynga’s net loss widened to $45.1 million, or 5 cents per share, in the quarter ended Dec. 31 from $25.2 million, or 3 cents per share, a year earlier.

Revenue rose about 9 percent to $192.5 million, but came below average analyst estimate of $201.1 million.

Excluding items, Zynga broke even on a per-share basis, as analysts had expected.

The San Francisco-based company’s shares were trading at $2.39 after the bell.

Reuters