Zynga delaying IPO?
The social-gaming site may put off its IPO until November in light of the stock market's recent roller-coaster ride, according to the New York Post.
Social-gaming site Zynga may delay its initial public offering until November as a result of the current turmoil in the stock market, according to the New York Post.
Zynga was looking to raise up to $1 billion by going public as early as September. But citing sources "with knowledge of Zynga's plans," the Post said the company has been concerned by the stock market's recent up-and-down ride, prompting it to back off on its IPO for now.
Launched in 2007, Zynga has turned into a force for online social gaming with such popular titles as FarmVille, CityVille, and FrontierVille. The company offers certain games through Facebook but also provides several through various mobile platforms.
Zynga, which could see more than $1 billion in sales this year, has been one of the most anticipated public offerings this year, according to the Post. The company's SEC filing pegged its valuation at $11 billion in March. But the stock market chaos has put a damper on the overall IPO market.
Beyond any stock market worries, Zynga has also reportedly raised some red flags with the Securities and Exchange Commission over its S-1 filing, the Post added.
The SEC has told the company to stop using certain "non-traditional accounting measures" in its filing. It also expressed concerns that Zynga said it relied on a small number of paying customers for most of its sales. In an amended filing, the company admitted that less than 5 percent of its users pay for the virtual goods available through its games.
Still not satisfied, the SEC has been pressing for more details, which Zynga has been hesitant to provide, said one of the Post's sources.
Zynga did not immediately respond to a request for comment.
In another distraction, Zynga was recently named in a patent infringement lawsuit by a company called Agincourt Gaming, which is alleging the violation of two of its patents.