Zynga to lay off 18% of workforce, shut down sports games

Struggling social gaming company Zynga says it will cut 18% of its workforce in a bid to return to profitability.

The company announced the layoffs in tandem with its Q1 earnings results. Total revenue in the three months ending March 31 rose 9% to $183.3m and the company narrowed its net loss by nearly one-quarter to $46.5m.

The company expects the layoffs to eventually generate savings of $45m per year, although there will be up to $22m in restructuring costs in Q2. At least, that’s the plan. Zynga previously cut 520 staffers back in June 2013, which obviously proved insufficient to stop the firm bleeding barrels of red ink.

Bookings, i.e. gamers’ purchases of virtual goods, rose nearly 4% to $167.4m. As testimony to Zynga’s efforts to wean itself off its former desktop dependency, 63% of overall bookings came via mobile devices, an improvement of 84% year-on-year. Mobile daily users rose 18% while the mobile monthly audience rose 29%. Advertising and other revenue fell 1% to $35m.