Zynga cuts more than 500 employees
Bad news from social game publisher Zynga today - they've cut 18 percent of their workforce, a layoff of more than 500 people, according to a blog post on the Zynga Web site.
Zynga's been in trouble for a while. The company had huge early success with social games like FarmVille and Words With Friends, but it's had a tough couple of years. In 2012 the company purchased OMGPOP, a New York-based indie developer riding high on the release of its hit mobile game Draw Something, a Pictionary-style game in which players take turns creating illustrations to depict keywords. OMGPOP's CEO left Zynga earlier this year.
Zynga paid more than $180 million to acquire OMGPOP, which many analysts questioned at the time, given the company's relatively limited scope. OMGPOP was one of the last in a series of expensive acquisitions Zynga made, and the company's stock is a pale shade of its IPO price.
In a letter sent to employees, Zynga CEO Mark Pincus said, "The scale that served us so well in building and delivering the leading social gaming service on the Web is now making it hard to successfully lead across mobile and multiplatform, which is where social games are going to be played."
Pincus suggested in the article that the company's future lies in the mobile gaming space, as opposed to social gaming on PCs and Macs.