Zynga Inc (NASDAQ:ZNGA) is set to post its first quarter earnings today, April 23, which is seen as a critical one as the game maker has been struggling over the past one and a half years to garner market share. Important metrics such as revenues, bookings and monthly active users (MAUs) are expected to decline, but margin may improve due to cost cutting efforts taken by the company. Mobile operating segment would be an important segment to watch as the company is once again targeting the segment for growth.

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Cost cutting efforts could boost bottom line for Zynga

Zynga Inc (NASDAQ:ZNGA) has accepted previously that the efforts made by it were not enough to drive growth in the mobile segment. In recent times, the company has taken numerous steps to improve its performance in the mobile gaming, as it recently launched a new version of Farmville for iPhone, iPad and Google Play.

All major social networking and tech companies have acknowledged the importance of a mobile platform for their business, and Zynga should readily adopt it. Facebook Inc (NASDAQ:FB) and Pandora Media Inc made efforts to update their mobile platform, which made their shares surge quickly and impressively.

The social game maker announced layoffs in the fourth quarter of 2013, which may improve its bottom line. The company will apparently remove 15% of its current workforce, which could in turn improve the margins of the company. Also, the game maker may restructure its entire business over the next few quarters. Revenue for full fiscal 2014 is expected by Zynga Inc (NASDAQ:ZNGA) to come in a range of $760 million to $810 million, and EBITDA margin in the range of $65 million to $100 million. Overall non-GAAP earnings per share are estimated to be positive, which would be a huge relief for the company.

All eyes on Farmville 2

Morgan Stanley analyst John Egbert believes that bookings and user metrics will be stable after having “likely bottomed out,” in the last quarter. The analyst is more focused on FarmVille 2: Country Escape, believing that to be the “more interesting topic.”  According to the analyst, there will be an early sign of the user growth in the first quarter of 2014, and expect DAU, MUU and MAU of 32 million, 90 million and 126 million respectively. Booking estimates as provided by Egbert are $145 million and EBITDA of $7 million, both of which are below the consensus estimate.

Egbert said that the success of Farmville 2 will help in early booking growth for Zynga Inc (NASDAQ:ZNGA), but cautions that success should continue for long term booking growth.