Zynga has released its annual earnings, increased its revenue from its games slightly year-on-year, from $161 million to $167 million in the first three months of 2015.
63% of the revenue came from mobile titles, a shift for the historically social networks present games developer.
The company was down overall in the quarter, losing $6.7 million more than the previous year which saw a $6.3 million loss.
As part of cost cutting measures, Mark Pincus said they would be letting 364 people go, which equates to approximately 18% of its workforce. Some of those positions lost are due to the company closing its Orlando, Florida studio affecting mainly central services and corporate.
Zynga has also opted to focus on less genres and have five they will put their game teams on; Action Strategy, Social Casino, Invest and Express, Casual, and Racing. This means its sports titles will no longer be developed including NFL Showdown and Tiger Woods Golf.
The mail sent out by Pincus was picked up by Gamasutra and reads
I wanted to share that today, along with our Q1 earnings results, we announced a cost reduction program which will enable us to focus and align against our best opportunities.
We need to be more resourceful in how we manage our costs in order to fund our investments in great new games and data analytics. We’ve over-burdened our game teams with complexity and centralized expenditure.
We expect these cost reductions to generate $100 million dollars in annualized savings. We are reducing our workforce by 364 people or approximately 18 percent, closing our Orlando game studio, decreasing our outside services and reducing our central functions.
I wanted you to hear this news from me first as we will be notifying impacted employees today. I know everyone will join me in supporting all of our employees who were affected.
Days like today are difficult. I know it’s hard to say goodbye to talented teammates who have contributed to our mission and delivered value for our players.
Please join me for a 30 minute All-Hands today at 5 pm PDT in the Café, where I will host an open Q&A. We’ll also send out my Earnings prepared remarks prior to the meeting so you can read them in advance. If you have questions about today’s news please feel free to ask them at our All-Hands or send them to Dani [email protected] and I’ll read your anonymously submitted questions.
We’ll be making the All-Hands available via vidcon to all studios outside San Francisco. Additionally, Marcus and I will be hosting follow-up vidcon meetings tomorrow night at 8:30 pm PDT for Studio-I and Friday morning at 9:30 am PDT for our UK studios – details to follow.
If you have specific questions related to your project or team please feel free to reach out to your manager.
We wish all those affected by the re-sizing of Zynga the best in their future endeavours.