Zynga Inc (NASDAQ:ZNGA), the social game company has been struggling primarily due to its over-dependence on a single platform, i.e. Facebook Inc (NASDAQ:FB), claims Electronic Arts Inc. (NASDAQ:EA) mobile head, Frank Gibeau.
The New York Times recently published an interview with Frank Gibeau where the executive expressed his opinion on the outlook for Zynga.
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Zynga over-relied on Facebook
While replying to the question asked about Mark Pincus’s (the co-founder of Zynga) comment that more people will play games in the future, Gibeau told the Times: “Zynga blew it. They’re not a mobile business.”
Continued Gibeau, “We’re six or seven times their size in mobile. Zynga Inc (NASDAQ:ZNGA) fell into a hole because they were completely focused on one platform, which is Facebook.” However, presently, Zynga Inc (NASDAQ:ZNGA) does work separately through its own platform, Zynga.com.
Gibeau believes that independent developers are now a major threat to both EA and Zynga Inc (NASDAQ:ZNGA), however, EA realized the fact much sooner than Zynga.
EA reducing exposure on Facebook
In a bid to lower its dependence on Facebook, EA recently shut down a few games that include The Sims Social, SimCity Social, and Pet Society.
Gibeau told the Times, “We saw all the Facebook users going to smartphones. You can’t play a game on Facebook on a phone.” “Coupled with that was the fact that customer acquisition costs were on a straight line up” he added.
EA has lately witnessed growth in revenue from the mobile segment as Gibeau added, “every smartphone, every tablet, is a gaming-enabled device.”
EA is slated to release its second quarter earnings on October 29 where the company’s digital and packaged business will be more thoroughly discussed.
Steadfast Management acquires stake in Zynga
In separate news, Robert Pitts, who heads Steadfast Management, acquired 31.5 million shares or a 5.07% stake in Zynga Inc (NASDAQ:ZNGA), according to the latest regulatory filing with the Securities and Exchange Commission (SEC).
On Monday, in the after hours of trading the stock price of the social gaming company was up 1.90% to $3.76 per share. After the close of market on Thursday, Zynga is expected to reveal its financial performance for the third quarter.
Back in 2012, Zynga Inc (NASDAQ:ZNGA) was the leader in the online community of gamers with a stock price above $14. Presently, Zynga is passing through a rough patch with a majority of its top executives leaving, and investors losing hope on the company to form fascinating games to cultivate its profit and hold its customers.