Zynga Inc (NASDAQ:ZNGA), in a regulatory filing on Friday, reported that after the departure of the two independent directors from the social gaming company’s board on June 11, the firm is no longer in compliance with Nasdaq listing rules, according to a report from Reuters. Per the Nasdaq requirements, the board of directors of a member company must have a majority of independent directors.
Deadline of July 27
In the filing, the game maker said it would soon provide details to the exchange on a plan of how it intends to return to compliance. The firm has a deadline of July 27 to file the plan. In April, Zynga Inc (NASDAQ:ZNGA) reported that LinkedIn co-founder Reid Hoffman (a director since 2008) and DreamWorks’ CEO Jeffrey Katzenberg (a director since 2011) will not be returning to the board.
Earlier this month, a report from Venture Beat revealed that three top executives have left the game maker; including Words With Friends head Travis Boatman, head of acquisitions Terence Fung, and former head of the company’s Ville franchise Steve Chiang. The exit of the key executives highlights the tough decisions taken by CEO Don Mattrick to reorganize and turnaround the struggling game maker.
Short interest dropping in Zynga
Zynga Inc (NASDAQ:ZNGA) witnessed a sharp decline in short interest in the month of May. According to a report from AnalystRatingsNetwork.com, short selling totaled 58,465,116 shares as of May 30th, which is decline of 7.6% from the May 15th total of 63,269,401 shares. Around 8.3% of the company’s float is currently sold short.
Sine the past year or so, the shares of the social gaming company have been volatile. The stock is down around 44% over the last three months, while year to date shares are down over 16%. At a recent Bank of America Merrill Lynch technology conference, CEO Don Mattrick acknowledged the struggle and said that the company is “nowhere near where we should be.”
However, analysts are hopeful that Zynga Inc (NASDAQ:ZNGA) will rebound from the current lows to perform well in both the both medium and long run. In a report issued last week, UBS analysts said they were “constructive over both the medium and longer term.”