Two more high-level executives departed Zynga Inc (NASDAQ:ZNGA) in recent days, continuing a trend that has persisted since March. While some turnover should be expected for a young company in Silicon Valley, the departures underscore investor skepticism about ZNGA and its ability to address the challenges it faces as it pivots towards mobile and its in-house gaming platforms.
Chief Marketing and Revenue Officer Jeff Karp the latest executive to resign. Mr. Karp will continue to be employed at Zynga Inc (NASDAQ:ZNGA) in a non-officer capacity through Sept. 22. Per his separation agreement he will receive three months base salary and the accelerated vesting of 100K RSUs, and agrees to a general release of claims. The resignation is not entirely surprising given Mr. Karp's ties to Zynga's recently departed COO John Schappert. Mr. Schappert's Aug. 8 resignation came after he was relieved of some responsibility following the 2Q earnings call. Both were former EA execs.
Chief Infrastructure Officer Allan Leinwand also resigns. Mr. Leinwand was the architect for zCloud, Zynga's in-house gaming platform. He will take a similar position at ServiceNow.
Jefferies has compiled partial list of notable Zynga Inc (NASDAQ:ZNGA) departures since March.
• Jeff Karp - Chief Marketing Officer, Chief Revenue Officer (Sept.)
• Allan Leinwand - Chief Infrastructure Officer (Sept.)
• Mike Verdu - Chief Creative Officer (Aug.)
• Bill Mooney - VP of Studios (Aug.)
• Brian Birtwistle - VP of Marketing (Aug.)
• John Schappert - Chief Operating Officer; Board of Directors (Aug.)
• Allan Patmore - General Manager, CityVille (Aug.)
• Erik Bethke - General Manager, Mafia Wars 2 (July)
• Ya-Bing Chu - VP, Mobile Division (July)
• Jeremy Strauser - Studio General Manager, Slots / Bingo Games (July)
• Curtis Lee - Director, Product Management (Mar.)
• Manny Anekal - Global Director, Brand Advertising (Mar.)
• Michael McCormick - Lead Developer, CityVIlle (Mar.)
With FarmVille 2, Zynga Inc (NASDAQ:ZNGA) hopes to prove it can turn its biggest hit games into franchises. For the game to be considered a home run, Jefferies will be looking for 20MM DAUs. Fewer than 5MM DAUs would be a disappointment. Other analysts are already calling the product a dud.
Disclosure: No position in any securities mentioned