Zynga’s Q1 2020 Financial results show that the company achieved its highest first quarter revenue and bookings in the company’s history, despite posting a net loss of $104 million from recent big acquisitions.
The company reported revenue of $404 million, up 52 per cent y/y, for the three months ended March 31, and bookings of $425 million, up 18 per cent y/y. The biggest drivers of that growth came from titles such as Empires & Puzzles, Merge Magic!, Game of Thrones Slots Casino and Merge Dragons!
While driving much of their growth, the 2018 acquisitions of Empires & Puzzles developer Small Giant Games and Merge franchise creator Gram Games resulted in the company posting a net loss of $104 million for the quarter. These acquisitions cost extra $120 million this quarter, while Zynga had forecast for $25 million.
The recent spate of acquisitions has been part of a successful strategy for Zynga, as they explained to us in an interview last month.
“Zynga has been on a roll with regards to doing really smart acquisitions in the marketplace,” said Bernard Kim, president of publishing at Zynga. “And our vision around this is focused on companies that have very strong live service businesses.”
“Small Giant Games has Empires and Puzzles which has quickly become one of our top grossing games. This is a steady live service business that continues to deliver. And then Peak Games has a portfolio of card games that just continues to steadily and consistently drive both fantastic features for players and revenue as well.”
Looking at the current quarter, Zynga is forecasting revenues up 31 per cent to $400 million, with a net loss of $60 million. Meanwhile, for the full year ahead, the company is forecasting $1.8 billion in revenue, while nearly doubling expected net losses from $130 million to $245 million.