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Zynga Shares Crushed as Earnings, Outlook Miss Big

CNBC.com With Wires
Wednesday, 25 Jul 2012 | 5:16 PM ET

Zynga'ssecond-quarter earnings and revenue missed analysts' expectations on Wednesday and the company's outlook fell far short of expectations.

David Paul Morris | Bloomberg | Getty Images

"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," the company said in a press release.

The news sent shares of the company's stock tumbling in trading after the closing bell.(Click here for the latest after-hours quote.)

Zynga had a lot riding on this quarter. Investors had been punishing its stock because of worries about declining user numbers

Zynga Plunges on Poor Outlook, Facebook Down
Zynga shares are down about 35 percent since the company reported disappointing earnings, bringing Facebook down with it, reports CNBC's Julia Boorstin.


Other Internet stocks including Facebook also fell in after-hours trading. (Click here for the latest after-hours quote.)

Zynga reported second-quarter earnings of 1 cent a share on revenue of $332 million.

Analysts had expected 5 cents a share on revenue of $344 million, according to an estimate from Thomson Reuters.

The maker of Farmville and other Facebook games said it now expects full-year earnings of 4 to 9 cents a share, well below estimates of 26 cents.

The results now raise questions about Facebook's second-quarter earnings, which are due out on Thursday.

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  • Matt Hunter is the senior technology editor at CNBC.com.

  • Cadie Thompson is a tech reporter for the Enterprise Team for CNBC.com.

  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.

  • Jon Fortt is an on-air editor. He covers the companies, start-ups, and trends that are driving innovation in the industry.

  • Lipton is CNBC's technology correspondent, working from CNBC's Silicon Valley bureau.

  • Mark is CNBC's Silicon Valley/San Francisco Bureau Chief covering technology and digital media.