Zynga Shares Falling as Much as 41 Percent in After-Hours Trading
The games-maker delivers a poor quarterly earnings report and partially blames Facebook, shares of which are also dropping.
Shares of Zynga, the maker of Alec Baldwin's favorite airplane game, Words With Friends, were sinking as much as 41 percent in the after-hours trading session as the company reported per-share profit that missed expectations by a mile.
Also plaguing the stock on Wednesday was lackluster guidance and user metrics that weren't up to snuff, which Zynga CEO Mark Pincus partially blamed on Facebook.
"We are lowering our outlook to reflect delays in launching new games, a faster decline in existing web games due in part to a more challenging environment on the Facebook web platform, and reduced expectations for Draw Something," Pincus said.
Shares of Zynga, which rose 3 percent during the regular session to $5.08, were sinking to about the $3-level after the closing bell, well below the stock's all-time low of $4.45. The company went public in December at $10 a share.
Facebook was also caught in the downdraft, its shares sinking 8 percent in the after-hours session after rising 3 percent to $29.34 during regular trading. Facebook is set to report quarterly earnings on Thursday.
Zynga said Wednesday its second-quarter revenue grew 19 percent year-over-year to $332 million. It reported a net loss of $22.8 million, reversing a profit of $1.4 million a year ago. It's loss per-share was 3 cents, though without certain items it scored a per-share profit of a penny, well shy of the 6 cents analysts expected.
Daily active users increased from 59 million a year ago to 72 million while montly active users increased from 228 million to 306 million.