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Zynga skyrockets on strong bookings

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Jody Amiet | Getty Images

Zynga shares rallied as much as 13 percent Thursday after first- quarter revenues topped analysts' expectations. Earnings broke even on an adjusted basis for its latest quarter, compared to forecasts of a 1 cent per share loss.

The stock closed up almost 11 percent Thursday.

Bookings were the bright spot for the online game maker. First-quarter bookings, the money spent on games by consumers, reached $182 million, up 8 percent from a year ago. Zynga also saw increased ad sales, although its customer base did decline.

When it came to guidance, Zynga gave mixed projections, with revenues below the average analyst estimate. Zynga also said it is on track to launch 10 games this year.

On a conference call with analysts, Zynga CEO Frank Gibeau said "over the long term, there is no reason why Zynga's margins can't be more in line with its peers. ... Zynga has all the ingredients needed for a successful turnaround, and it's well underway."

Gibeau recently replaced Zynga founder Mark Pincus. Wedbush Securities analyst Michael Pachter, who has a outperform rating on the stock, says Gibeau's efforts are working. In a note to investors, he said the "new and steady hand at the wheel gives us confidence that Zynga's turnaround is almost complete."

Shares are down about 5 percent year to date.

Zynga year to date Source: FactSet