Zynga Rolls out 'Slingo' After Mixed Results

Mike Snider, USA Today
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Zynga launches a new game today on the heels of its first quarterly earnings report as a public company.

CEO Marc Pincus assured investors that the online social-games company has a full pipeline of new products even as the company's mixed results presented a puzzle for those attempting to assess the online social-game company's performance. "The hardest part of this company is figuring out what it is worth," says Wedbush Securities analyst Michael Pachter.

Zynga posted a net loss of $435 million, vs. earnings of $16.1 million a year ago. It had $510 million in stock compensation expense from its December 2011 initial public offering.

But its adjusted fourth-quarter earnings of 5 cents a share surpassed analysts' expectations. And revenue grew 59% to $311 million, vs. a year ago, as Zynga's daily active user base grew 13% to 54 million in the period.

"The bottom line is, everything came out better than I expected," says analyst Atul Bagga of Lazard Capital Markets. "It is all about monetizing their audience better, and that is what they have been consistently doing in the last few quarters."

This year, the company expects consumers will spend even more on its games. Zynga ended 2011 with the top five Facebook games — among them CityVille, FarmVille and CastleVille— and "we have a strong pipeline for the rest of the year," said Pincus, who founded the company.

To that point, Zynga rolls out Zynga Slingo— a mashup of Bingo and casino slots. Like Zynga's other recent Facebook-based releases, Hidden Chronicles and Zynga Bingo, "these are all games in new categories for us," says John Schappert, Zynga's chief operating officer. "Our goal is to deliver the leading games in every category of play, and that is what we are marching toward." (Bingo is currently available to a limited audience in beta testing.)

One of the first online casual games to hit 15 years ago, Slingo combines a traditional Bingo card and a slot machine wheel. Each spin of the wheel produces five numbers below your card; you must quickly "daub" your square; the faster you do, the more you increase your bonus scores.

"Our goal," says Zynga product manager Rich Sawel, "is to put a fresh new take on it, to Zynga-fy it."