Zynga Q1 offers upside surprise, investors stage relief rally

Game company raises bookings and guidance for the current fiscal year.

Zynga games Zynga

Update: 4:45 PM P.T. Zynga's stock rose in after-hours trading after the company's first-quarter earnings report beat Wall Street's expectations.

"We're pleased with the progress that Zynga has made in the first quarter growing our audience reach 25% year over year and nearly 20% quarter over quarter. Our team did a great job launching 5 new games across mobile and web including new hits like Hidden Chronicles, Slingo and Scramble with Friends," CEO Mark Pincus said in a statement.

Zynga had revenue of $321 million, up 32 percent year over year and earnings per share of 6 cents, a penny more than Wall Street expected. Including $133.9 million in stock-related compensation, the company lost $85.4 million, or 11 cents per share, compared with a profit a year ago. The stock was up 3 percent in after-hours trading. The company also raised its bookings and EBITDA (earnings before interest, taxes, depreciation, and amortization) guidance for fiscal year 2012.

The company said that it had increased both mobile and Web bookings with most of that growth coming from mobile -- an interesting data point given how many companies still are grappling with how to better monetize the explosive growth in mobile computing. Zynga, whose revenue comes from the sale of digital goods on its Internet games, is also trying to diversify beyond Facebook.

In the quarter, the number of Zynga's monthly unique payers was up 21 percent to 3.5 million, compared with 2.9 million in the fourth quarter of 2011 . Some other stats of note:

  • Daily active users grew to 65 million from 62 million.
  • Monthly active users rose 24 percent to 292 million from 236 million.
  • Monthly unique users increased 25 percent to 182 million from 146 million.
  • Average daily bookings per average user grew 8 percent to $0.055 from $0.051.

    Financial year-to-year quarterly comparison

  • Revenue: $321.0 million, up 32 percent
  • Online game revenue: $292.8 million, up 27 percent
  • Advertising revenue: $28.2 million, up 117 percent

 

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