Zynga Inc (NASDAQ:ZNGA), the social game maker, has spent $310,561,000 on business acquisitions since 2010. The creator of Words with Friends has created financial deficit for the social and mobile business, according to Bloomberg.
Deficit getting worse
Bloomberg Editor-at-large Cory Johnson said that before Zynga started spending on acquisitions it had retained earnings of $10 million. According to the latest SEC filing, the present deficit amounted to $897 million, which according to Johnson is getting worse.
Acquisitions Made by Zynga
The acquisitions made by Zynga Inc (NASDAQ:ZNGA) over the past three years include OMGPOP, Bonfire Studios, Buzz Monkey, Newtoy, XPD Media, Challenge Games, Area/Code, Floodgate Entertainment, and MarketZero. Zynga slashed off some of the employees from these teams in the opening of this month.
Zynga Executives Leaving
Zynga has closed many of its studios and has induced multiple layoffs earlier this month. Recently Rob Dyer, vice president of the partner publishing segment in Zynga Inc. (NASDAQ:ZNGA) announced he would leave the company.
Andy Tian, Head of Zynga in China, is about to leave the company towards the end of this month. Tian was the one who created major contributions in the formation of XPD Media, which was taken over by Zynga, in May 2010.
Others who recently left the company include Brian Reynolds, chief creative officer Mike Verdu, chief security officer Nils Puhlmann, chief technical officer of infrastructure Allan Leinwand, OMGPOP chief revenue officer Wilson Griegel, Words with Friends co-creators David and Paul Bettner, and OMGPOP chief executive Dan Porter.
Small Credit Facility
As per the filing with the SEC, Zynga Inc (NASDAQ:ZNGA) has been given smaller $200 million credit facility, which is less than its previous $1 billion unsecured, revolving line of credit.
Zynga Inc (NASDAQ:ZNGA) has posted a series of unprofitable quarters, and it is struggling hard to maintain its user base, launch new games to allure users, and earn revenue. The company laid off 18 percent of its workforce and banks like Morgan Stanley, Goldman Sachs, Bank of America and JP Morgan Chase are limiting its credit limit.
The financiers may be reluctant to give aid to Zynga after the game maker ended its Draw Something studio OMGPOP in the beginning of this month. Zynga also slashed jobs in New York, Los Angeles, and Dallas in the beginning of the year.