Don Mattrick, president of the interactive entertainment business, which include the Xbox game console of Microsoft Corporation (NASDAQ:MSFT) left the company, and accepted the challenge to lead Zynga Inc (NASDAQ:ZNGA), the beleaguered online social gaming company.
Don Mattrick Appointed CEO By Zynga
Zynga Inc (NASDAQ:ZNGA) appointed Don Mattrick as chief executive officer and member of the board of directors effective July 8. According to the company, its founder and former CEO, Mark Pincus will remain as chairman of the board.
The announcement regarding the appointment of Don Mattrick as CEO provided a positive impact on the shares of Zynga Inc (NASDAQ:ZNGA). The stock value of the online social gaming company rose by more than 6% to $3.27 per share on Tuesday afternoon trading in New York.
Mattrick spent six years at Microsoft Corporation (NASDAQ:MSFT). He was instrumental in the growth of the software giant’s Xbox gaming console worldwide. During his tenure with the company, he supervised the team responsible in the expansion of Xbox 360 by 700 percent to 75 million consoles installed and increasing the Xbox Live membership from 6 million to almost 50 million in 41 countries.
Zynga Inc (NASDAQ:ZNGA) pointed out that Don Mattrick is widely recognized as the person behind the transformation of the interactive business entertainment of Microsoft Corporation (NASDAQ:MSFT) from a operating loss into a sustained and profitable business.
A related report from Joshue Brustein of Boomberg Business quoted a comment from Van Baker, analysts at Gartner that Don Mattrick has a “history of liking to move into organizations that have challenges.”
Zynga Inc (NASDAQ:ZNGA) has been struggling to prove to make its business profitable. Last month, the company decided to lay off 18% (520 employees) of its workforce as part of its cost cutting measures. The company also lost many of its top executives, and closed some of its offices to increase its profitability.
Last April, Former Zynga CEO, Mark Pincus even decided to cut his annual salary to $1.00 while the company evaluates a new compensation plan to keep its top employees and continues to implement its cost-cutting measures. Despite all the efforts undertaken by the management, investors are uncertain about the future of Zynga Inc (NASDAQ:ZNGA). The company lost around 70% of its stock value from its $10 offering price.
Zynga’s Turnaround Possible
Given Don Mattrick’s experience at Microsoft Corporation (NASDAQ:MSFT), perhaps he is the best fit to turnaround Zynga Inc (NASDAQ:ZNGA) and boost the confidence of its employees.
Pincus stated, “Don is unique in the game business. He can execute in multiple domains — hardware, software and network, and he’s been the person responsible for game franchises like ‘Need for Speed,’ ‘FIFA’ and ‘The Sims.’ He’s one of the top executives in the overall entertainment business and he’s a great coach who has inspired people to do their best work and build strong, productive teams.”
The members of board of directors of Zynga Inc (NASDAQ:ZNGA) also expressed confidence in Mattrick’s ability to revive the company. Reid Hoffman said, “I know from experience that the right successor has the potential to massively accelerate the growth of a company. Don Mattrick’s strong track record demonstrates that he can balance big picture vision with world-class execution…”
Meanwhile, Steve Ballmer, CEO of Microsoft Corporation (NASDAQ:MSFT) issued a statement describing Mattrick’s contribution in the company. According to him, Mattrick helped the software giant in releasing fantastic games and expanded Xbox beyond a great gaming. He cited that the Xbox team will report directly to him.